Shipbuilding Crisis
The Shipbuilding Crisis was a financial crisis that heavily contributed to a large recession that occurred in the early 24th century. The crisis, predating the recession, was mitigated for a decade before the intricacies of the Enzmann-type market fell through. Several banks and businesses would close when dockyards and manufacturers were forced to claim bankruptcy. The Crisis would be studied heavily in business economics for the private mitigation, and then eventual bailout—the largest in Human history. To date, the recession following the Crisis was the source of the largest total lost in Credits in human financial history prior to the , and also saw the largest unemployment rate in Martian and Jovian history. The general results of the Shipbuilding Crisis was better regulation of shipbuilding practices, and a crackdown on dockyards and manufacturers promising shareholders profits based on unsold ships. This also signaled the end of most Enzmann-type ships in favor of more sturdy Honeycomb/Box structured vessels, the types of which are now used most commonly in contemporary Human spaceflight. Overview After the creation of the and it's unveiling in 2291, several hundred orders of Enzmann-types were put on an indefinite hold, and production then slowed to a crawl. Over the course of the next decade, many more partially completed ships in queue were cancelled by the hundreds. With the advent of Slipspace travel, Enzmann-types were made partially obsolete. Mars and Jovian Enzmann-type shipyards were impacted the heaviest by consumer reaction to the unveiling of the Translight Engine. Due to the high demand of Enzmann-types prior to it's unveiling, it was common for these shipyards to construct ship frames before orders were made, and Deuterium fuel bought before the funds for fuel was procured. With orders for ships being cancelled, and consumers unwilling to pay the price for such costly upgrades, the jump in cancellations spurred the closing of several orbital Shipyards, and the bankruptcy of several large Enzmann-type Shipbuilding Corporations, including it's forebearer Daimler-Raytheon. Shipbuilders of small to medium sized general purpose craft would be forced to sell ships at lower prices, but most would generally would fair well during the crisis. Though many companies did attempt to quickly market retrofitting these ships, the design of most Enzmann-types were not readily suited for Slipspace travel. Retrofitting more sturdy frames and, then, state-of-the-art navigation systems were deemed a costly investment for consumers who had already been paying top dollar. Considering the Enzmann's were also originally marketed as "cost-effective", public reaction to retrofitting was unenthusiastic at best. Pulse Propulsion, in particular, was a system of propulsion that was always relatively weak to other consumer craft and required for ships to commit changes in velocity over long distances. The cost of retrofitting an Enzmann-type with newer, more powerful fusion engines, could easily jump to double the retrofit cost without a Translight engine included. With the addition of a costly early production Shaw-Fujikawa Translight Engine, this could triple on Enzmann's original cost. Less than a dozen Enzmann-types were known to have all these retrofits done prior to Operation: SLOW BURN which began in 2370. Most detrimental, though, to most ship builders was the issue of Enzmann-fuel tanks. Massive deuterium fuel tanks that were designed to fuel ships for several hundreds, or even thousands of years, were the defining feature of the Enzmann-type. The design itself was not an issue, and buyers in the Crisis market felt that smaller fuel tanks for localized travel made the ship worthwhile in in-system flight. The issue for builders arose from the common practice of paying for large amounts of deuterium fuel with credit. This was often credit that companies expected to be able to pay back with the prospect of an ever increasing demand for colony vessels. The Slipspace Engine ruined this model of procurement. Some Enzmann-centric businesses attempted to recoup funds by liquidating pre-built frames and selling Enzmann-types at discount prices. A majority of these frames and Enzmann-types bought during these liquidations would end up in the hands of Jovian civilian hands. The local economies of many shipping companies were still struggling in the decades after the end of the , and these cheaper Enzmann's did fill a gap that many had struggled to be fill. Jovian Enzmann-types would often be retrofitted to carry water-ice after the ship was given a smaller Deuterium fuel tank. This did help some Shipbuilders in the short term, but the ship market was very saturated and, after consumers had cashed in on the clearance-priced ships, sales slowed once again. During this era, several investment banks would also close due to shipbuilding businesses defaulting on loans, and losing market value. These investment banks would often give high-risk loans to these corporations to buy raw metal and fuel. When shipbuilders began to claim bankruptcy, a lot of these banks folded or were bought by larger institution. Bank closures caused a wider spread financial panic and subsequent market crash on Tuesday November 18th 2303 known as "Grey Tuesday" thenceforth. An on again-off again market recession followed for the next two decades. Ultimately, the would vote to step in in 2305 and introduce a Several Trillion Credits stimulus package to shipbuilders, mining corporations, metal works corporations, and financial institutions to keep them operational. This was done largely to avoid a larger system-wide depression which UEG and UNSC officials feared would spark another Interplanetary War. In 2317, the of the UEG bottomed out at a loss of 11%. From that point, it would take markets another decade to recoup the losses to GDP before the Crisis began.